The 5 biggest challenges in retail & how to approach them
Retailers who don’t go beyond selling a collection of products and services will be copied. And they will probably end up in hot water because of it. Because the only differentiator they still have is price, and that’s just a race to the bottom. These price wars have conditioned consumers to look at price and price alone, and that’s bad news for all parties involved.
Denis Ghys revealed that to succeed in today’s retail climate, retailers have to be willing to invest in strong internal and external service design. Internal services will help them to offer strong or surprising products and services, while external services prove to be of real value for consumers. (Think, for example, of flexible delivery options and other new services).
2. From purchasing and product-driven organizations to customer experiences: customer journey creation
The entire retail business was built on purchasing and sales per square foot. Today, the customer has taken center stage, and many retailers are struggling to pivot towards a customer-centric organization. That’s where customer journey creation comes in. Mapping the existing customer journey is one thing, but creating and developing a future customer journey is another matter entirely.
As Denis Ghys explained: “You need to design the store of the (near) future, define your proposition and beat out the competition in the process”. And it all starts with shaping future customer expectations and paving the way to superior service.
3. Data strategy - From purchasing data to customer insight: making data work for you
Most retailers are sitting on enormous amounts of data (think of supermarkets and their loyalty programs). Today, these are only used to infinitesimally improve the purchasing process, not to gain insight into the customers’ needs. And that’s a shame.
“What retailers should be doing”, says Denis Ghys, “is creating innovative data strategies to integrate their data with external sources and new tools in order to attract and engage new as well as existing customers with killer content”.
4. Native design: From store / website / communication to one retail concept - surprising and seamless touchpoints for a unified customer experience
We are being bombarded by messages, images and new alternatives to existing services, so retailers have to invest in their brand identity more than ever before. You need to be surprising and recognizable across all touchpoints. Gone are the olden days where you could coast on a certain level of consistency (think color schemes and specific shapes or symbols). Today, you need to amp up the coherence in your stores, but also across social media, in customer conversations, the new services you offer, and more. When you get that brand experience right, you will eclipse other retail brands and be less dependent on pricing.
Creating and implementing brand visions and translating them to a complete, omnichannel experience that draws your customer in, that’s the power of native design.
5. Last but not least: From traditional research tools to tools that map shopper expectations
Your typical monitoring tool barely scratches the surface of omnichannel shopping behavior. The modern customer expects very different things at different times. To meet customer expectations across all channels, you need to dig a lot deeper.
New or integrated tools such as the newest evolution of the BrandAsset® Valuator – the world’s largest database and model on Brands – called BAV Shopper and the specialized research divisions like KANTAR retail will help you offer a consistent and optimized service across all channels. It will take effort and resources, but for companies hoping to excel in the modern world, it’s do or die.
Would you like to experience the changes in retail firsthand? Join us on our Retail Shopping Tour and learn valuable new strategies from your front row seat.